What Direction Is The Housing Market Really Heading In?

What is really going on in the housing market these days? One day the headlines are good news, the next it is all doom and gloom. So where are headed, is it really a good time to buy or are the opportunities going to get better?

CNN Money reported this week that after several false starts home prices have begun a new plunge. While this may sound scary so far we are only talking about a less than 2% drop in most key cities nationwide. However with a new wave of foreclosures expected after recent freezes this ‘double dip’ could become an incredible nose dive. This could be great news for investors who are purchasing rental properties that they plan to hold for the long term, but very bad news for sellers who have stubbornly tried to hold out, hoping this would improve and they could get more for their properties. The bottom line here is that if you know you need to sell, you need to get your home listed now and if you are underwater talk to a real estate agent or investment firm about doing a short sale.

One thing is certainly going up in the world of real estate and that is mortgage interest rates! Chief economist at Bankrate.com, Greg McBride said today ‘you can kiss those record lows goodbye’ in reference to rates that have been running in the 4% range. Mortgage interest rates have already spiked up almost a full percentage point in the last couple of months alone. This is bad news for those who were sitting on the fence expecting things to get cheaper. Remember even if prices to slide down a little further before rebounding higher interest rates can mean paying tens and even hundreds of thousands more for the same property. If you are one of those that has been waiting for just the right time to start buying you may have missed the absolute bottom but you can be sure that you will not see deals like you can get now for decades, probably never again in your lifetime.

However new home starts are up showing confidence and return of builders and developers to the market and the indicators are in place that suggest that barring any complications we should be seeing improvements in the later part of 2011. Don’t hold your breath for a huge rebound overnight, but those buying wisely now will certainly be getting their hands on some incredible deals that will result in big returns over the next few years.

What Direction Is The Housing Market Really Heading In?